Readers in Miami-Dade, as well as in other localities throughout the U.S., may or may not be aware of the estate tax liability that may be imposed on a person’s estate before it can be disbursed to his or her beneficiaries. Legally married couples, however, are covered under a marital deduction from having to pay an estate tax on property or assets that were transferred to them by their spouse upon their death.
Prior to the recent repeal of the Defense of Marriage Act (DOMA), even if they were married in a state that recognized same-sex marriages, gay and lesbian couples were not eligible for the marital deduction on death taxes when their spouse passed away. Along with a number of other rights and benefits that were made available after DOMA’s being declared unconstitutional, same-sex couples who have been legally married in a state that recognizes same-sex marriage now too are protected by the marital tax exemptions.
While the Internal Revenue Service (IRS) has reportedly made the necessary adjustments, only those who have paid estate taxes in this type of situation over the last three years, 2010 through 2012, are able to file a refund claim to recoup what they had previously been ordered to pay. That is because the IRS has a statute of limitations on refunds. For the time being, it does not appear the IRS will change its stance on the time frame for requesting a refund.
Whether you have an existing estate plan that requires modifications, or if you need to start from the beginning, it may be of benefit to consult with an experienced lawyer. An attorney can offer guidance and help you to establish a plan that addresses your needs and those of your estate.
Source: Bloomberg, “Same-sex Marriage Fight Looms Next on IRS Estate Refunds: Taxes,” Diane Freda, Oct. 15, 2013